
FT MEADE 

GenCol 1 





























































































































































































Class -fctExZS4 

Boofc .H Z.l-j 

CopMi^lu N?. _ 

COPYRIGHT DEPOSIT 




































i 




4 



EDWARD HENRY HARRIMAN 


Edward Henry Harriman 

A Prince of Men 


By CLARENCE JAMES HOUSMAN 

M 



PRIVATELY PRINTED 
















ALL RIGHTS RESERVED, INCLUDING THAT OF TRANSLATION 
INTO FOREIGN LANGUAGES, INCLUDING THE SCANDINAVIAN 


COPYRIGHT. 1920, BY CLARENCE JAMES HOUSMAN 



t 


1 

* 


• « 
« • t‘ 
< 


§)CI, A566179 

MAh 23 htQ 


'Wv V 


I dedicate these lines to 
Edward Henry Harriman 
who left more than wealth—a memory 
of love and affection. 


Clarence James Housman 






EDWARD HENRY HARRIMAN 
















Edward Henry Harriman 

A Prince of Men 

I N THE relations that exist be¬ 
tween big men of finance and 
their brokers there are oppor¬ 
tunities for revelation of character 
that do not exist in most other human 
contacts. Perhaps it is because the 
things they have to do together must 
be done by both with an intensity of 
mental application, at times under a 
nervous strain, that brushes aside 
the ordinary reserves and restraints 
of manner and thought which so often 
hold an invisible barrier between men 
who seemingly meet face to face. 
My business experience has brought 
me such associations with many of 
[ 3 ] 


Edward Henry Harriman 

the outstanding figures in the recent 
financial history of America and, of 
them all, Mr. Edward Henry Harri¬ 
man was by far the biggest man in 
many ways. He was a greater man 
than most of his countrymen realized 
while he lived, but those who were 
fortunate enough to see him at close 
range realized this, and time will re¬ 
veal him to others for what he was. 

And so I have long desired to make 
this little record of my intimate 
glimpses of the man—felt it in a 
way my duty to bear witness to the 
largeness of spirit, the unvarying 
courtesy and gentleness of one who 
was anything but what the careless, 
hasty newspaper chronicles of his day 
[ 4 ] 


A Prince of Men 

represented him to be. Mr. Harri- 
man himself was always keenly inter¬ 
ested in newspaper comments upon 
his work and his motives, their car¬ 
toons of him and the like, but he never 
expressed, nor do I believe he ever 
felt, any deep resentment for those 
who attacked him. Even at the time 
of his controversy with President 
Roosevelt I never heard him say 
anything more about his opponents 
than that their attitude was erro¬ 
neous or that they were misinformed. 
To-day, when I see so many trusted 
statesmen making the identical ideas 
of Mr. Harriman on railroad consol¬ 
idation their own, I recall with no 
little admiration the equanimity, al- 
[ 5 ] 


Edward Henry Harriman 

most the indifference, with which he 
heard the outcry raised against his 
ideas when they were new. 

But it is not my intention to dis¬ 
cuss Mr. Harriman’s works. They 
are already too well understood for 
that. Rather I have in mind his 
personal qualities. Whatever may 
have been the case in his earlier 
career, during the time I knew him 
he never doubted the fundamental 
soundness of his undertakings or 
their ultimate success. His utter¬ 
ances were quiet but positive, like 
those of a man whose interest was 
centred in the longer future. And 
I had ample indications that this 
was so. Once when we were dis- 


A Prince of Men 

cussing Southern Pacific extension 
projects in Mexico and elsewhere, he 
remarked that his railroad plans 
were constantly laid ten to twelve 
years in advance of their execution. 

On the other hand, he turned with 
facility to the handling of emergen¬ 
cies, being never deterred for a mo¬ 
ment by the great scope such opera¬ 
tions might assume. His taking 
hold of the Erie and saving it from 
bankruptcy in the spring of 1908 is 
a case in point. His first step was 
to buy up all of the Company’s notes 
then approaching maturity, to do it 
vigorously and to the extent that 
they came upon the market. His 
confidence was justified by success, 
[ 7 ] 


Edward Henry Harriman 

but his task was not finished. When 
the new issues of notes replacing the 
old came out, it was for him to make 
the market for them and insure 
their flotation. I called him up one 
morning and told him there was a 
bid of 97^ for fifty of the notes, re¬ 
marking that it seemed to me to be 
a high price. 

“ Why do you think so?” he asked. 

“Well,” I said, “ considering the 
credit of the Erie, it seems to me a 
pretty good price.” 

“What do you know about the 
credit of the Erie?” was his reply, 
gently spoken but effective. For 
the moment he was the credit of the 
Erie. 


A Prince of Men 

I never knew a man who would 
engage in larger operations—in 
other words, back his judgment with 
a bigger bet—or do it with less ap¬ 
parent effort or concern. When he 
was buying “calls” on Union and 
Southern Pacific stocks in London, 
before they were paying dividends 
his orders were given over the tele¬ 
phone in unlimited amounts in the 
same matter-of-fact way as though 
they had been for one-hundred-share 
lots. On one such occasion I re¬ 
peated the order. He understood 
me to ask if he did not think he was 
buying pretty heavily, and his an¬ 
swer was, “At those prices you may 
buy all you can get”—and to my 


Edward Henry Harriman 

surprise he added, “ I am going on 
the yacht this afternoon and won’t 
be back for two days. Just let my 
office know.” 

When a well-known floor operator 
was offering Southern Pacific at 
$60.00 a share I informed Mr. Harri¬ 
man of the fact, and he instantly 
authorized me to buy every share 
offered at that price, the order to be 
good until the close of the Exchange 
that day. After having been short 
of a large amount of Erie common 
for three months, during which time 
he never once referred to the matter, 
Mr. Harriman called me up one day 
and remarked, 

“I think I am short of Erie.” 

[ 10 ] 


A Prince of Men 

“Yes,” I replied, “about thirty 
points higher.” 

“Don’t you think it is about time 
to cover?” 

I acted on the assumption that 
this was an order, and I was not 
mistaken. 

Mr. Harriman’s interest in elec¬ 
tions and fondness for betting upon 
them was another manifestation of 
his disposition to back his judgment 
heavily. Having bet $10,000 on a 
candidate, he asked me how much 
more money the opposing side was 
offering on the Curb. I told him 
there was at least as much more and 
he replied: 

“Bet all there is.” As a means of 

[ 11 ] 


Edward Henry Harriman 

getting an idea of how far he was 
willing to go I asked: 

“Suppose there is a million out 
there?” 

“Bet it,” was his answer, “and see 
how much more there is.” 

Mr. Harriman experienced more 
than one Wall Street panic, not one 
of which disturbed his calm judgment 
of men and conditions, or shook his 
confidence in the stability of his per¬ 
sonal affairs. At one such time I 
was in his office, telling him how 
badly the market was acting. While 
I sat there he called up five different 
interests and told the head of each, 
in substance: 

“This thing is all wrong. Look 

[ 12 ] 


A Prince of Men 

after your properties and I shall look 
after mine.” Promptly the market 
rallied and the whole situation 
changed for the better. During the 
panic of 1907, when I told him of a 
rumor that he had had a “row” with 
J. P. Morgan that day, he replied: 

“It has gotten so that I cannot go 
over to Mr. Morgan’s office to have 
a talk with him without people criti¬ 
cizing and looking for trouble. As 
a matter of fact, I went to Mr. Mor¬ 
gan and offered him $2,000,000 of 
my choicest securities to save the 
Trust Company of America.” 

On the evening of the worst day of 
the memorable period, October 21st, 
when Union Pacific sold at par, I 
[ 13 ] 


Edward Henry Harriman 

went to see him at his house. As he 
came into the library he remarked, 
half jocularly and half seriously: 

4 ‘What is the matter with you 
fellows downtown?” 

“If you want to know the real 
story,” I said, “Roosevelt says you 
will have to give up your position as 
President of the Union Pacific.” 

Just at that moment the telephone 
rang. Answering, and evidently 
speaking to one of his daughters, Mr. 
Harriman said: 

“Mother is in the parlor with Mrs. 
Kruttschnitt.” Turning from the 
telephone, he remarked to me: 

“I shall never give up the job as 
long as I am under fire, but if I ever 
[ 14 ] 


A Prince of Men 

should, the man who will get it is 
down in the parlor now.” It has 
always since been my opinion that 
Mr. Kruttschnitt would have been 
chosen to succeed him because I im¬ 
agine that he was in the parlor with 
Mrs. Kruttschnitt; but after Mr. 
Harriman’s death his powers and 
duties as head of the Union & South¬ 
ern Pacific went to Judge Lovett. 

Reference to the financial storm 
that raged around Mr. Harriman as 
the central figure in 1907 would to 
me be incomplete unless it included 
an incident which forced me to make 
almost instantly the most difficult 
decision of my whole business career. 
One day when the situation was ap- 
[ 15 ] 


Edward Henry Harriman 

proaching its worst, a man of con¬ 
siderable prominence in the financial 
district at the time and still better 
known now, whom I had known well 
and considered a man of excellent 
judgment, came into my office and 
behind closed doors advised me that 
I was making a mistake in sticking 
to the Harriman ship, that Mr. Harri¬ 
man was sure to fail and that I was 
only courting the destruction of the 
firm which my brother, A. A. Hous- 
man, had founded. He strongly 
urged me to notify Mr. Harriman to 
take up his account at once. 

At that time I was only thirty - 
seven years of age and had lost my 
brother within a few months through 
[ 16 ] 


A Prince of Men 

whose death I had become the head 
of the firm. We were carrying up¬ 
wards of $6,000,000 of securities for 
account of Mr. Harriman. Whether 
I should follow this man’s advice, 
or act on my own judgment meant 
almost everything to me—certainly 
everything in the world in a mate¬ 
rial sense. After a moment’s reflec¬ 
tion I said: 

“Mr. Harriman has never yet 
shown me the slightest sign of either 
financial weakness or faltering will. 
If I ask him for additional margins 
to the amount of $250,000, h§ sends 
me $300,000; if I ask for $300,000, 
he sends me $400,000. His personal 
bearing is that of a man with no un- 

[ 17 ] 


Edward Henry Harriman 

usual anxiety on his mind. So long 
as these things continue as they are 
I see no reason why I should not 
continue to represent him.” 

Later, the same day, I was called 
to the office of a downtown banker 
who had on his desk a cablegram 
from London enquiring as to the 
position of my firm. He invited me 
to give him any statement I cared to 
make. He seemed to know our large 
commitments in London so I told 
him that the big proportion of our 
account was for important clients 
who, up to then, had responded to 
all our margin calls, and in fact, that 
we had kept a margin in London, 
which was not the English custom. I 
[ 18 ] 


A Prince of Men 

added that I would gladly give him 
a statement as to the amount of the 
firm’s capital if he wished to know. 
He then closed the interview. 

These two incidents, occurring with¬ 
in a few hours of each other, had a 
significance which I think I fully re¬ 
alized at the time, crowded as the 
day was. Some person or persons 
were out to “get” Mr. Harriman and 
had picked to send to me with friend¬ 
ly advice the man who was, in their 
judgment, most likely to influence 
me. At the same time, by whom or 
by what means I do not know, in¬ 
quiries had been set afloat in London, 
where we were carrying a large 
amount of securities for Mr. Harri- 
[ 19 ] 


Edward Henry Harriman 

man through our correspondents, as 
to our financial stability. As every¬ 
one knows, that panic spent itself 
without doing Mr. Harriman any 
harm and was succeeded by a period 
of rapid recuperation in which his 
enterprises amply proved their es¬ 
sential solidity, as well as the sagacity 
and conservatism with which they 
were administered. 

Coming to the more intimate and 
personal side of Mr. Harriman, there 
was in his nature a courtesy that 
went deeper than mere words, a sin¬ 
cerity that is not always an attribute 
of big men. A stockbroker neces¬ 
sarily calls a client very frequently 
on the telephone to keep him in- 
[ 20 ] 


A Prince of Men 

formed of prices and other market 
matters. On such occasions Mr. 
Harriman never anticipated or inter¬ 
rupted by saying, “I know that,” as 
I have known other busy men to do, 
but was always appreciative of every 
effort in his behalf. Yet he never 
made a remark that he did not mean 
for the sake of an easy evasion. 

Shortly after my brother’s death I 
expressed to Mr. Harriman the hope 
that it would not affect the firm’s 
relations with him and added that 
while he had a big account with us, I 
was anxious to do more of his busi¬ 
ness. He answered frankly: “I never 
put all my eggs in one basket.” 

Of his disposition I can only say 

[ 21 ] 


Edward Henry Harriman 

that it was sweet, a word one hesi¬ 
tates to use in reference to a man and 
particularly one of so forceful a char¬ 
acter. But it well describes a certain 
quality he had. This was due in 
large part, I think, to the invariable 
cleanness of his mind and to the 
strength with which wholesome per¬ 
sonal and family relations appealed 
to him. One Sunday afternoon he 
wanted to get into touch with me 
quickly. I was not at home but 
Mrs. Housman promised him over 
the telephone to get me up to his 
town house within the hour. She 
did so, though it was before the days 
of automobiles. Mr. Harriman re¬ 
marked that not every woman could 
[ 22 ] 


A Prince of Men 

find her husband so easily on such 
short notice and appeared to be not 
a little impressed by an incident 
which, in the retelling, may seem to 
be only a trifle. But that was the 
human responsiveness of the man. 

Mr. Harriman was able to relax 
his mind in the humor of the little 
everyday occurrences even when he 
was much occupied with the weigh¬ 
tiest matters. He could poke fun at 
himself with relish. One summer 
day I wore into his office a decidedly 
unusual straw hat. He immediately 
wanted to know where I got it and 
asked me to get him one. When I 
inquired the size he wore, he answered 
with the boastfulness of a boy: “Big- 
[ 23 ] 


Edward Henry Harriman 

ger than you.” And his head was 
in truth much larger than mine, 
though he was much the smaller man 
in stature. He took more interest 
in the hat I got him than many a 
man would in some elaborate pres¬ 
ent. 

On another occasion, when I was 
in his office late in the afternoon he 
asked his colored porter to go to the 
telephone and ask Mr. Schiff to take 
him uptown. Mr. Schiff had gone 
for the day. He then tried Otto 
Kahn and Mortimer Schiff in turn 
and got the same reply regarding 
both. Turning to me with a smile 
he said, “I suppose you will think I 
am trying to impress you by showing 
[ 24 ] 


A Prince of Men 

you how I stand with Kuhn, Loeb & 
Company.” On my telling him once 
that I had obtained some “time 
money” which the Standard Oil 
Company had sent into the market, 
he said: “I hope you did not tell 
them it was for me.” 

When Mr. Harriman was waging 
his fight for control of the Illinois 
Central and was in Chicago to attend 
an annual meeting of that company, 
his secretary telephoned on a Satur¬ 
day that he would reach New York 
the following morning and wanted to 
see me immediately upon his arrival. 
While I was under the shower Sun¬ 
day morning I was called to the tele¬ 
phone. Mr. Harriman asked: “Is 
[ 25 ] 


Edward Henry Harriman 

everything all right? ” meaning in re¬ 
gard to his accounts with us. 

“Yes,” I replied, “how is every¬ 
thing with you?” He laughing re¬ 
plied: “All right. I shall be at home 
after five this evening. You can see 
me there if you want to tell me any¬ 
thing.” 

Chiefly out of curiosity to see how 
he was standing the strain I went to 
see him that evening. As I was 
leaving after a casual conversation 
about business matters he gave my 
arm a playful shake and said: 

“You didn’t have anything to say 
to me. You only wanted to look me 
over.” That was only one of the 
proofs I had of his ability to see 
[ 26 ] 


A Prince of Men 

what was passing in other men’s 
minds. 

Hardly anything is better known 
of Mr. Harriman than his loyalty to 
his associates, but it extended even 
into small matters of personal bear¬ 
ing. He once wanted to buy a few 
shares of one of the subsidiary 
companies of the Union Pacific 
system from a man who refused to 
sell. 

It happened that the man was an 
enthusiast on billiards and Mr. 
Harriman asked me if I played the 
game. I did not, but undertook to 
reach the man and succeeded in get¬ 
ting him to Mr. Harriman’s office 
after the members of Kuhn, Loeb & 
[ 27 ] 


Edward Henry Harriman 

Company had failed to do so. The 
man still refused at that time to part 
with his stock, but in my presence 
and much to my embarrassment, he 
began congratulating Mr. Harriman 
upon his choice of an intermediary, 
saying that he could not have picked 
a better man to approach him. Mr. 
Harriman interrupted him rather 
curtly with, “You needn’t tell me 
anything about Mr. Housman. I 
know all about him.” 

When I reported to Mr. Harri¬ 
man that a prominent broker was 
offering to sell the next dividend on 
Union Pacific at a price less than the 
amount of the last preceding divi¬ 
dend, his reply was: 

[ 28 ] 


A Prince of Men 

“You can buy all he wants to sell 
at any price.” 

I began buying and shortly after¬ 
ward the offering ceased. Three 
weeks later I happened to be at the 
Plaza with a number of men, one of 
whom was the broker who had of¬ 
fered the dividend at a discount. 
Quite by accident he addressed to 
me the question: “I wonder who 
told Mr. Harriman that I was selling 
the Union Pacific dividend?” It 
was evident that Mr. Harriman had 
carefully guarded the source of his 
information about the attack upon 
Union Pacific stock. 

When my brother, who was my 
partner, died on August 20 , 1907, 
[ 29 ] 


Edward Henry Harriman 

Mr. Harriman was in camp in 
Utah. My brother’s death occurred 
at 5:30 o’clock in the morning but 
was not known on the Street until 
10 o’clock. When I reached my 
own home in New Jersey at 2 o’clock 
I found there a telegram from Mr. 
Harriman expressing his sympathy 
and asking, “Is there anything I can 
do for you?” 

A short time later I had a curious 
revelation of the manner in which 
the head of a 20,000-mile railroad 
system serving chiefly an agricul¬ 
tural territory turned his mind to 
other things than the stock market 
at times when most men downtown 
could think of nothing else. My 
[ 30 ] 


A Prince of Men 

brother had been greatly interested 
in fine livestock and, in particular, 
had owned a wonderful line of pigs. 
In the heart of the 1907 panic one 
of Mr. Harriman’s best friends, Mr. 
John R. Townsend, called up to in¬ 
quire what had become of the pigs. 
I had to tell him that I couldn’t 
talk pigs until after 3 o’clock, but evi¬ 
dently Mr. Harriman had spoken of 
the pigs while stocks were tumbling. 

Some days before he was to sail 
for Europe, during his last illness, 
Mr. Harriman said to me: 

“Housman, I should like to see 
you at my house before I go away. 
Remind me of it every morning when 
you call up, so that I can set a time 
[ 31 ] 


Edward Henry Harriman 

free from interruptions to chat with 
you.” On the Friday before his 
departure (he sailed on a Tuesday) 
he fixed the time for that afternoon. 
While we were together he said: 

“I have closed my account with 
you and if I ever do anything in 
Wall Street again I shall remember 
you, as I have enjoyed our pleasant 
relations during these past years. 
Now, I suppose you want my opin¬ 
ion on the market.” And he pro¬ 
ceeded to give it, for the first time 
in all the period of my associations 
with him. He put it in very few 
words. This was at the end of May. 

“It all depends upon the crops,” 
he said. “Big crops will mean a big 
[ 32 ] 


A Prince of Men 

market; small crops, stocks will go 
down; with an ordinary crop there 
won’t be much for the boys in the 
Street to do.” 

It sounds simple enough, but it 
reflects the conception he held of the 
stock market. To Mr. Harriman it 
was a barometer of fundamental 
conditions throughout the country 
and a place where the nation’s finan¬ 
cial requirements were expressed and 
measured. 


THE END 


[ 33 ] 



v t 
* l t 


< 

















LIBRARY OF CONGRESS 






















































































